Online shopping has changed the way we buy things, and recently a rise in buy now pay later companies (BNPL) offerings have changed the way we pay for our purchases. BNPL services have gained a lot of popularity recently; they provide shoppers with alternative payment options that go beyond traditional credit cards. They generally don’t charge interest, either, which makes them a good option from a total cost standpoint.

These services offer flexibility by making it easier for shoppers to buy products and spread the cost over time. Some of the top buy now pay later companies are Affirm, Klarna, Afterpay, and PayPal. Here’s a look at  each of those companies and their features, benefits, and potential drawbacks.

Buy now pay later companies

1. Affirm

Affirm is one of the top names in BNPL, and it’s known for its transparent and user-friendly approach. It offers installment plans that allow customers to split their purchases into fixed monthly payments over a specified period of time. At checkout, you can choose from a variety of repayment terms, ranging from three months to 36 months, depending on your budget and preferences. Affirm doesn’t charge late fees or compound interest, so it’s easy to understand and manage your payments.


  • No hidden fees: Affirm really stands out here, for its clear and transparent pricing. Customers know exactly what they’ll pay upfront, with no surprise fees or interest.
  • Budget-friendly options: With various repayment terms available, customers can find a plan that fits their budget and avoids the burden of a lump-sum payment.


  • Limited merchant acceptance: Affirm has a growing list of merchants it works with, but it may not be available for every online store, so you can’t necessarily use it everywhere you want to shop.

2. Klarna

Klarna offers a range of payment solutions, including BNPL. You can choose the payment schedule that works best for you, such as paying in full, splitting the cost into four equal payments, or opting for longer-term financing. Their “Pay in 4” feature has been particularly popular among users, enabling them to make smaller payments over time without accruing interest.


  • Multiple payment options: Klarna allows you to choose the most suitable payment method based on your financial situation.
  • Easy to use: Klarna’s user-friendly app provides a seamless shopping experience, making it easy for you to manage your payments and track your purchases.


  • Potential late fees: While Klarna doesn’t charge interest on its BNPL plans, late payments may incur fees, potentially impacting the overall affordability for some users.

3. Afterpay

Afterpay allows you to split your purchases into four equal payments, due every two weeks. It doesn’t require a credit check, so it’s a good option for people with less than ideal credit or without much credit history (making it especially popular with younger shoppers).


  • No interest: Afterpay charges no interest or fees on its BNPL plans.
  • Instant approval: Customers receive instant approval for Afterpay at checkout, streamlining the payment process.


  • Repayment is not so flexible: with a maximum of only four payment installments available, some customers might want more extended repayment terms.

4. PayPal Pay in 4

PayPal, the OG of the online payment industry, has also ventured into the BNPL space with its “Pay in 4” feature. It allows shoppers to split their purchases into four interest-free payments, with payment due every two weeks.


  • Trusted platform: PayPal’s long-standing reputation and widespread acceptance give customers peace of mind when using their BNPL services.
  • Accessibility: The “Pay in 4” feature is available to many PayPal users, expanding its reach to a large customer base.


  • Limited to US customers: As of now, PayPal’s BNPL feature is only available to customers in the United States, but the fact that that’s the only con we could come up with reflects positively on Paypal Pay in 4!

Comparing the BNPL Companies

The award for most flexibility goes to…

Affirm and Klarna offer the most options for repayment terms, so they’re the best choice if you need flexibility around the amount of each payment and the length of time you have to repay the loan. (Afterpay and PayPal offer only one repayment schedule, of four equal payments.)

Interest and Fees 

Affirm and Afterpay don’t charge interest, so their pricing is straightforward and it’s easy to know exactly how much your payment plan will cost you. You’ll have to pay late fees with Klarna, while PayPal’s “Pay in 4” feature is interest-free but may have late fees for missed payments.

Where can you use it?

The best payment plan in the world isn’t very helpful if you can’t use it for what you want to buy. Paypal and Klarna are available to use more places due to their long-standing presence in the payment industry. Affirm and Afterpay are expanding their partnerships, but they still aren’t as widely available as the other two.

The bottom line

Buy now pay later companies have revolutionized the way consumers shop and pay for what they buy. Each company has its own strengths and features, to accommodate different types of users. Affirm stands out for its transparency, Klarna for its payment options, Afterpay for its accessibility, and PayPal for its trusted reputation. Regardless of which service you choose, it’s important that you exercise responsible spending and budgeting to avoid any potential financial pitfalls. Before opting for BNPL, it’s a good idea to carefully consider your ability to make payments and make sure you select the option that best meets your needs and preferences.